Building a complete 3D Minecraft-like game with all the features you described is a substantial undertaking, typically requiring a large team and significant development time. It involves complex systems for world generation, rendering optimization, physics, AI, inventory management, survival mechanics, and networking, among others.

Due to the complexity and scope of such a project, providing a full, production-ready game implementation within a single response is not feasible. However, we can establish a foundational project that demonstrates the core technical challenges of creating a blocky 3D world in the browser using Three.js. This foundation will include:

1. Basic Three.js Setup: Initializing the scene, camera, and renderer.
2. Block Representation: Defining different types of blocks.
3. Chunk System: Dividing the world into smaller, manageable sections (chunks) to handle large environments efficiently.
4. Procedural Generation: A simple method to generate initial terrain within chunks.
5. Mesh Generation with Optimization: Creating the 3D geometry for each chunk by combining block faces, including a basic optimization to only render faces that are visible (i.e., adjacent to air or a transparent block). This is crucial for performance in block worlds.
6. Basic Interaction: Implementing the ability to place and break blocks using mouse clicks.

This foundational project addresses the core rendering and world management aspects. Features like a full inventory system, survival mechanics (hunger, health, crafting), complex mob AI, advanced physics, and sophisticated procedural generation algorithms would need to be built as separate systems on top of this foundation. The blocky sun could be added as a simple mesh in the scene. Optimizing rendering further by only generating/rendering chunks within the camera's view frustum (frustum culling) and potentially using techniques like level-of-detail (LOD) or instancing for specific elements are also important steps for a complete game but add significant complexity beyond this initial structure.

The following artifact provides the code for this foundational project, focusing on the block world, chunking, mesh generation with face culling, and basic interaction.

Building a comprehensive Minecraft-like game involves several complex systems working together. The previous response provided a foundation for rendering a blocky world using chunks and basic face culling optimization. Expanding upon this requires implementing player interaction, movement, and integrating game mechanics like inventory and survival.

Implementing a full survival game with mobs, crafting, and advanced physics is a very large project. However, we can build upon the foundation by adding core first-person controls with basic collision detection and structure the code to allow for future expansion into inventory, survival, and mobs.

The primary technical challenges for the next step are:

1. Replacing OrbitControls: Implementing custom first-person camera control driven by keyboard and mouse input.
2. Collision Detection: Adding logic to prevent the player from moving through solid blocks. This typically involves checking the player's bounding box against the grid of blocks.
3. Gravity and Jumping: Simulating vertical movement based on gravity and player input.
4. Modularization: Splitting the code into logical files (world, player, input, main) to manage complexity.
5. Raycasting from Player: Modifying block interaction (breaking/placing) to use a ray originating from the player's camera view.
6. Face Culling Clarification: The previous implementation included face culling, which hides faces of blocks that are adjacent to opaque blocks. This is a standard optimization in block games to avoid rendering geometry that is not visible. It is distinct from Level of Detail (LOD) or frustum culling (hiding objects outside the camera's view). The current face culling logic correctly hides faces against opaque neighbors.

The following artifact provides an updated project structure with basic first-person movement, gravity, simple collision, and modular code organization. It also updates the block interaction to work from the player's perspective. Placeholder structures for inventory and survival are included to show where these systems would connect, but their full implementation is beyond the scope of this response.